During the many global lockdowns caused by Covid-19, the world witnessed a decline in demand for power and paused to reflect upon the type of world likely to emerge post-Covid. A world embracing green technology looks ever more desirable as a means to tackle the climate crisis with more sustainable forms of energy and transportation available. Before committing to making an investment in green technology or a company which embraces green technology, it is essential to have a precise understanding of the classification. The aim of green technology is to protect the environment, retrospectively repair the damage caused to it and conserve and preserve natural resources.
Investment in renewable energy is particularly attractive and will only continue to develop. Governments and corporations are regularly signalling their commitment to the UN’s climate change target as laid out in the 2015 Paris Agreement. A UN report published in September indicated that the number of governments and companies pledged to reach net zero carbon emissions has doubled in the last year.
A report published by the International Energy Agency (IEA) in October indicated that global energy demand would fall by 5% in 2020 and highlighted renewable energy as the only source which would increase during the year. The IEA projects renewable energy to meet 80% of the growth in global electricity demand over the next ten years with solar and wind power providing especially ambitious projections.
A developing trend in the energy sector is divestment: companies moving away from involvement in fossil fuels. In due course, some of the traditional oil giants may be considered to be clean energy companies – a situation beyond comprehension just a few years ago.
The trend towards cleaner forms of transportation will also provide investment opportunities as the sale of electric vehicles continues to increase. The technology required to power electric vehicles extends beyond the production of high-powered chargeable devices to also include the installation of charging facilities across the road network.
Green technology covers the technology used in making buildings more energy-efficient. In the case of newly constructed houses, smart technology is increasingly de rigueur but retrofitting of existing buildings with energy-saving devices is – and will continue to be – a significant growth area.
Green nanotechnology refers to using nanotechnology to enhance the environmental sustainability of processes which have a negative impact upon the environment in addition to the creation of products which enhance sustainability. Companies which use green nanotechnology will find favour with investors due to their cutting-edge status.
Companies who make products designed to eliminate/reduce the generation and usage of hazardous substances also come under the umbrella of green technology companies. The number of start-ups and small companies who seize upon a niche element of green technology will often attract favourable taxation breaks for investors.
Many governments have poured funding into companies and industries with a high carbon footprint in order to sustain the economy and livelihoods but the green economy has also been the recipient of funds. The private sector will recognise the attraction to contribute to the green sector and help meet environmental goals.